There are many reasons for buying a warranty when you purchase a new vehicle, but some of those reasons might be based on inaccurate information or even lies.  Dealers are often offered incentives if they make certain financial quotas, and therefore put pressure on customers to purchase warranties that are overpriced or completely unnecessary.

Auto warranties can provide you with important coverage in the event that something goes wrong with your vehicle, but many include numerous exclusions that are hidden in the fine print, and others provide coverage only for a limited amount of time or miles.  It is extremely important to read every warranty fully before agreeing to purchase it.  Some warranties are definitely worth the added expense when purchasing a new car, but others simply put more money into the pocket of the dealer.

Basic Warranties:

Basic warranties, also called bumper-to-bumper warranties, cover nearly everything on a vehicle, with the exception of general wear-and-tear items such as hoses, brakes, wiper blades, and tires.  This type of warranty typically provides protection for three years or 36,000 miles, but may be extended by some manufacturers.

Powertrain Warranties:

Powertrain, or drivetrain, warranties cover major components of a vehicle, including the engine, drive shaft, and transmission.  Wear-and-tear items are not covered, and coverage generally lasts for three years or 36,000 miles.  Before agreeing to purchase this type of warranty, make certain it covers all critical internal engine components and contains no fine print listing exclusions.

Extended Warranties:

This type of warranty is often unnecessary, unless you intend to keep and use your vehicle for many years.  To prevent your claim from being denied, it is essential that you ask your warranty provider a number of questions before agreeing to purchase an extended warranty.

1. Does the vehicle need to be inspected by an approved expert before repairs can be performed?
2. Are repair costs paid for upfront, or will you be required to pay for them yourself, file a claim, and then wait to be reimbursed?
3. If your warranty is bought at the time you purchased your vehicle, are you allowed to use your coverage for repairs made at a location other than your dealership?

It is not unusual for customers to pay for repairs out-of-pocket, and then not receive reimbursement because their claim is denied.  Extended warranties should be fully researched before purchase, and the rules set forth in the policy need to be strictly followed.

Luxury Items Warranties:

This type of protection provides coverage for luxury (generally electronic) components, including navigation systems, DVD players, phones, and other equipment.  While the thought of replacing these expensive items in the event that they become damaged or lost is unsettling, often the cost of the warranty is higher than the repair or replacement cost of the equipment.

Rust / Corrosion Warranties:

Rust and corrosion warranties will cover the cost to repair the damage done to the body of your vehicle by rust or corrosion.  However, this type of warranty typically does not cover surface rust, which means the corrosion must be long-term in order to be covered.  Proper washing and waxing of a vehicle generally provides adequate rust and corrosion prevention, and costs significantly less than this type of warranty.

Hybrid. Efficiency. Not exactly the words you want to be thinking about when you look to purchase a new car and rightfully so. Since we were teenagers, the automobile has meant excitement, speed, adventure and all that America stands for: freedom (or as Cadillac puts it: Life, Liberty and the Pursuit). Some of us take it a step further and spend our weekends at the local race track reaching speeds most people only dream about. So, when we sit in our econo-boxes outside the local Shell station pumping regular gasoline @ $4.03 per gallon, buying something that will put a lot of wind in your hair and a huge smile on your face is the farthest thing from your mind. I’m here to tell you that your next car may not only be significantly more efficient than your current car, but it might might be pretty quick too!

Let’s start this discussion out with an American icon, the Chevrolet Corvette. Since 1953, the Corvette has won the hearts and minds of America with it’s sporty and muscular styling, extreme performance and bulletproof reliability. It’s a super car that you can use every day, and hundreds of thousands Americans do. So, how can I contort the Corvette into wearing a “green” badge on it’s sleeve? Let’s say you pop down to your local dealership and pickup a standard Corvette coupe or convertible, you’re looking at a 6.2L V8 engine. Assuming you want a little more gusto under the hood, a 7.0L Z06 with 500 stampeding horsepower is available as well. Looking at equivalently performing Ferrari’s or Lamborghini’s, you’d expect highway mileage to top out at 18 MPG and city driving would sink into the single digits. The standard Corvette hits around 18 MPG in the city and real-world mileage of around 30 MPG on the highway. Even with the Z06 you’re looking at around 16 and 26 in city and highway, respectively. Mind you, the Z06 does top out at over 200 MPH. Not to mention, the Chevy LS based engines are some of the most reliable on the planet. You could trot down to your local dealer today knowing that you’d be one of the fastest on your block, yet still keeping the environment and your pocketbook in mind.  Do a car search by mileage here.

Next on our list is a small company based out of Hethel, Norfolk, England by the name of Lotus. Since the early 60s, Lotus has been creating cars with the mantra, “less is more”. From the very first Lotus Mk1s and the famous Lotus Elan (weighing in at a spritely 1600lbs) to the most modern Lotus Elise (tipping the scales at approximately 2100lbs), Lotus knows the #1 way to make cars perform both efficiently and quickly is to remove all the extra weight you can. Now mind you, this doesn’t mean you remove the safety as well. With a solid aluminum monocoque (a chassis type used in most racecars), the Elises can take a jolt as well as most cars on the road, but with the performance an Elise gives you, it’s party trick is it’s amazing avoidance ability. With roughly 1/2 the weight of most cars on the road today, the Elise is a modern marvel in lightweight engineering. By the way, did i mention that you’d be driving a car that does around 30MPG and does 0-60 in well under 5.0 seconds?

The next car is a particularly popular modern “vintage”: The Mini Cooper. Whether you buy a brand new Mini, a new Mini Cooper S or an old Austin Mini, you are bound to max our both your miles per gallon and smiles per gallon. These amazingly fun and fast microcars are large enough to fit you and a loved one, packed for a long weekend and able to get your there in judicious style (with the basic Mini Cooper getting close to 40MPG and the S getting in the low 30s). They have passed safety ratings consistently with the highest ratings, but more to the point, the Mini urges you to go Motoring and take the long way home (the really long way). The Mini’s legendary road holding ability lets you hit a full .9 lateral Gs if properly setup. A stock 2008 Corvette hits .93 lateral Gs. How’s that for a giant killer? There are millions of Mini owners, new and old, and I can bet you that you’ll never come across one that regretted their purchase.

The final car on my list is an oldie but a goodie. It’s a car that’s no longer made, but even legends fade into the past from time to time. The final car on my short list for fun and economical cars is the Honda CRX. It’s another car that goes by the Lotus mantra and espouses this by a curb weight of between 1700 and 1900 lbs. (depending upon the year and spec). The 1984-87 ‘HF’ spec. car hit a whopping 49 and 54 MPG cycles for city and highway driving, respectively. Even the “performance” Si version and tuner versions are seeing well over 34 MPG combined cycle. The CRX is a very popular car for club racing and weekend drivers schools, which lend themselves some street-cred as exhilarating drives.

As the fuel prices continue to rise, I’ll be adding to this article more cars, both new and old for all budgets. So, please stop back again and we’ll try to have more cars for you to read about. Thanks for stopping by!

My last post was about basic “paper work” associated with the car. Every car has a VIN number. It’s like an auto-social security number. However, something every car does not have is a great service history and a great previous owner. With that said, the rest of the posts about buying a used car will be about the intangibles of a used car purchase. This week, we’ll be talking about the test drive.

The first thing is that when testing a used car, be sure the previous owner gives the car at least a half day to cool down before you come for a test drive. If the car has trouble starting cold, an owner may warm the car up for you before you get there to subvert the problem for a potential buyer. In the same respect, be sure to shut the car off after your test drive an try to start it warm.

Next we’ll discuss the engine itself. Pop the hood while it’s running and look at the engine. If it’s rattling back and forth you could have problems with engine bushings or an actual engine problem that could require costly engine replacements. After checking the engine idle, be sure while on the test drive you accelerate the car throughout the rev range. A slight power loss could indicate there are problems with anything from throttle position sensors ($$) to ECU problems ($$$) or full on engine problems ($$$$$). Listen to the sound of the engine at all these speeds. It’s good to make sure the radio in a potential car works, but don’t let yourself play songs the whole time. Listen to the engine and, for that matter, the transmission. If you hear heavy thuds when shifting, you could be in store for a transmission that has never had it’s fluid changed. This can be a $2000-3000 job. With a manual transmission, make sure you’re shifts are tight and slip into the gate solidly. If not, you could have bushings that need to be replaced, or worse, broken transmission internals. With automatic or manual (standard) gearboxes, put the car into every gear! Don’t assume if one or two work they all will (more so with automatics). Manual transmissions should have relatively quick engagement of the clutch, or you could be spending a few hundred dollars replacing your clutch.

To ensure the car’s steering is in tip top shape, be sure to find an empty road or parking lot and turn the wheel from one side to the other at full lock. This will not only test your steering response (and ensure you might not have power steering problems), loading the left and right suspension will yield a slight grinding noise if one of the wheels bearings needs to be replaced. Likely, you’ll only hear it from one site. This is not a hugely expensive job, but you can expect to pay $200-300 depending up the shop. Any other sever squeeks or shimmies when the suspension is loaded can indicate other suspension problems like bushings, worn shocks or springs and loose components. Be safe, but give drive and accelerate such that you can get a feel for all the corners of the car. This is a hard skill to master and know what you’re looking for and it will often behoove you to take a friend who does know this, or go on a test drive with a mechanic as part of a pre-purchase inspection.

When test driving a used car, be sure to check things like cruise control too. This is another thing often overlooked by most people on a test drive.

The last, and perhaps most important thing to check are the quality of the brakes. Talk to the current owner and ask if you can check the ABS by panic stopping in a parking lot from 25-30 MPH. Most times you’ll see an ABS light if there is a problem and most problems concern ABS sensors which are pretty cheap to replace. However, if you do have a ABS pump problem, you can expect a few hundred dollars for repair.

With any of the above options, remember, if you do have concerns, you can either have the previous owner fix the problem as part of the cost of the used car, or expect to see discounts and you can repair them yourself or have a mechanic fix the problem. That way, you’ll have someone you trust to the repairs as well as saving some money on the car of your dreams.

When we go out looking for a new or used car, the word “tire kicker” often evokes a negative stigma. However, it represents what everyone looking for a new or used car should be doing: an inspection. Once you’ve come up with your initial criteria for a replacement of addition to your current stable of cars, you’ll often want to research the possible choises you have for a variety of things like reliability, economy, usability and other real world metrics. All of the above a very personal things that each person weighs in a way only they can. However, when you actually go to check out the car itself, it’s easier to have a guide that you can run through in a mechanical fashion to make sure the car of your dreams won’t become the car of your nightmares.

This post is the first in a series of posts where I’ll present a new set of criteria as part of an inspection. At the conclusion, I’ll post a complete PDF checklist that every owner should use to see if the car you have your heart set on is, in fact, meat to be. So, onto part 1 of the list: VIN Inspection

1. VIN matches other VIN’s on vehicle and paperwork/Proper attachment (original/no alterations)
2. Vehicle has California emission sticker (California only)
3. Service bulletins and recall updates performed on vehicle
4. Check vehicle for trouble codes
5. Oil Change/Scheduled Maintenance Performed

eBay is infamous for people posting pictures of a valid VIN on a car that looks exactly like the one they are selling, when in fact they have a title that gives a completely different VIN. That clean VIN will show a car with an excellent history and the same features as the car being sold. The sellers count on a lazy user who won’t compare the VIN on the car when they see it in person to the VIN they were given to do a CarFax check with. It’s pretty strait forward, but people can be lazy and not check these things when the high of seeing a new car takes over. Once this is verified, you’ll often be able to check for service recalls. Taking the car to a local mechanic that specializes in the model you’re interested in is another great way to make sure the seller is honest and you’re getting what you’re told you are. Most mechanics will check car error codes for free, for example, and those who do charge will probably do it for less than $50. Should the car you are looking at have a check engine light (CEL), taking it to a mechanic to validate the reason is a MUST. From personal experiance, it’s very easy to buy a running car with “just a CEL on” and end up with a car that has a cracked engine block or head. If you’re lucky enough to find a car that has a complete history of records, check the average mileage between oil changes. Simply changing the oil and filter every 3000-5000 miles will help ensure your car will last years to come without serious internal engine problems.

I hope you enjoyed this small post and hope you’ll come back to learn more about our next inspection step…

The Road Test!

When buying used cars there are some important things to look for before making the final decision. The first thing to check is the engine. You need to look at the overall condition of the engine. Is there oil all over? Does there look like the belts are worn? If you see anything that does not look right, you should inquire as to why. You can have your own mechanic check to see if there are any potential problem with the engine of the used car. Check out these 8 best used cars under 10k that are fuel efficient.

The body is another thing to look at. Just because you do not see any rust or holes, does not mean the underside does not have rust or holes. Check the wheel wells and the trunk for holes or rust. Take a close look at the bumpers. Make sure there is no rust by the connections. Make sure the bumper is secure.

Check the odometer. The mileage on a car is important. Compare the mileage to the mileage listed on the title. It is possible to turn back the odometer. An inconsistency with the odometer reading may be that a different engine was installed. Remember to check all the gauges after you start the car. This includes the gas gauge, oil pressure gauge and the temperature gauge. A faulty gauge can cause confusion for the driver.

The last thing to look at in your used car search is the condition of the frame. Examine the car from a straight on view from the front and back. Make sure the frame is straight. Cars that were in an accident and repaired may shows signs of frame damage that could not be repaired correctly. Ask the person questions about the car. Make sure you know everything about the car.

You can check with some of the car websites to see the history of the car. This helps you find out a little more information about the car that may not be known by the person selling it or the person may not want to disclose the information. All you need is the VIN number, which is located in the window on the left side of the car.

Next, take the car for a test drive. Make sure to take it on the highway to see how the front end handles. A shaky front end may be a sign of an unaligned front end. See how the vehicle handles turning, stopping and accelerating. If the car passes all of your tests and examination, you are probably getting a good car that will last for a while.

Buying a car is often a complicated process, and it is made even more complicated when dealers dangle rebates and other incentives in front of your face.  Sometimes these incentives may even be intentionally used to draw your attention away from other, less appealing, aspects of the deal you are being offered.  The most typical incentives offered to potential customers include rebates and low-interest financing.

One very important thing to remember is that rebates are offered by the manufacturer of the car.  They do not come from the dealer, and therefore you still have the right to negotiate every aspect of your price and financing with your dealer before agreeing to purchase the car.  Generally, the best approach is to get the price of the vehicle lowered before agreeing to accept the rebate or special financing that is being offered.  Your dealer may be less willing to work with you if he knows you are planning to take the rebate.

Always read the fine print carefully before you agree to any terms.  This is especially important when you are receiving incentives, as often additional fees may be included to help cover the cost of the special deal you are being offered.  Low-interest financing may also only apply to shorter terms and less popular vehicle models.  Be certain to ask before you decide which car to buy, or you might end up wasting hours on paperwork before realizing that the incentives you were interested in are not available to you.

Incentives are typically used to motivate potential customers to purchase models that are selling slowly.  Dealers often receive their own incentives straight from the manufacturer for selling a specific number of that particular model.  Generally, these factory-to-dealer incentives result in less cost to the dealer.  This should be reflected both in the incentives offered to you, and in the price of the vehicle.  Although dealers are not obligated to pass these savings along to their customers, knowing that these dealer incentives exist may strengthen your side during price negotiations.

The decision to buy a new vehicle is an important one.  All aspects of the purchase need to be carefully considered before you agree to sign the contract.  Research your vehicle choices carefully before heading to the dealership, and look into financing options available based on your credit score.  If you feel you are not getting a good deal, consider moving on to the next dealership.  Dealer incentives vary from one dealer to the next.  Some may be more willing to work with you than others.